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DHS

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The Office of Mental Health and Substance Abuse Services (OMHSAS) conducted Technical Assistance (TA) sessions regarding the updated Psychiatric Rehabilitation Services (PRS) regulations outlined in 55 Pa. Code Chapter 5230. These sessions were held in November 2024 for licensed PRS providers and Behavioral Health Managed Care Organizations (BH-MCO). The revised regulations became effective on January 18, 2025. To further support licensed PRS providers and BH-MCOs in implementing the new regulatory requirements, OMHSAS has released a Frequently Asked Questions (FAQ) document addressing common questions identified during those sessions. The FAQ document is now available; you can view the document here.

The FAQ document can also be found at the links below.

Comments and questions regarding this memorandum should be submitted via email to the DHS Psych Rehab inbox. You can also contact RCPA Policy Associate Emma Sharp.

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The Office of Child Development and Early Learning (OCDEL) has released the outcomes from the Early Intervention (EI) Rate Methodology Study that concluded in the Fall of 2024. A key focus of the RCPA Early Intervention Steering Committee’s strategic agenda has been the review of how rates have been historically developed, including the lack of sustainable rate increases that have taken place over the past two decades. In our collaboration with OCDEL and other early intervention stakeholders, the goal was the development of a quantifiable rate methodology that uses the cost of care as a driving variable in the rate development matrix.

The EI Rate Study Final Report has been added to DHS website and can be viewed here. The study was the culmination of a year-long effort led the Public Consulting Group (PCG) and an Advisory Committee, which RCPA and other provider members were a part of.

The report reviewed the methodology and formulary variables for rate calculations across several operational dimensions of early intervention services, including staffing, operations, administration, and the calculation of how missed and cancelled visits intersect with actual costs.

The final funding review of the estimated Commonwealth fiscal impact was calculated using the number of service units provided during FY 2022/23 for Early Intervention services, current Federal Medical Assistance Percentage (FMAP), and county contributions. Services with a recommended rate decrease were kept at the current rate when calculating Commonwealth fiscal impact. The result indicated that for FY 2022/23, the rates were underfunded by more than $71M, or roughly 38% of the FY 2022/23 rate.

This year there is a proposed State budget increase of $10M that is targeted to aid Early Intervention providers in stabilizing their workforce infrastructure. This would be a 3% increase over the FY 2023/24 rate. There was no rate increase last year in anticipation of the rate methodology study report. There was hope that the study outcomes, which ended in September 2024, could have made a greater impact on this year’s projected rate increase. That notwithstanding, RCPA fully supports and will be advocating that the proposed $10M funding allocation be approved for Early Intervention services in the final budget. Additionally, there is a projected Medicaid allocation of $12.6M, for a total $22.6M that will go to the final rates for FY 2025/26.

Finally, the report indicated that between the periodic rate studies, PCG recommends that OCDEL implement a rate monitoring program to measure costs annually against payments. This monitoring should also measure inflation, and OCDEL should adjust rates annually to match the rate of inflation.

RCPA thanks OCDEL and our members for the partnership in the project and looks forward to the opportunity to work together in supporting and advocating the implementation of rates that support the cost of delivering high quality Early Intervention services to the children and families of the Commonwealth.

If you have any additional questions, please contact RCPA COO Jim Sharp or IPRC Policy Director Cindi Hobbes.

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The Senate Appropriations Committee held the 2025 Department of Human Services (DHS) Budget Hearing at the Capitol in Harrisburg on Wednesday, March 5, 2025. DHS was represented by Secretary Dr. Valerie Arkoosh and Gloria Gilligan, Director of Fiscal Management, Office of the Budget. Other DHS leadership was also present.

The Senate Appropriations Committee was equipped with questions surrounding the proposed $21B DHS budget that focused on intersects with operating critical services for vulnerable Pennsylvanians across the human services landscape. RCPA submitted questions to the House Appropriations Committee’s legislators that voiced the concerns of the membership across all policy areas.

The hearing today covered several of those questions, including:

  • The projected $2.5B dollar increase in the capitation and intersects with Medicaid unwinding in PA;
  • Impacts of potential federal Medicaid cuts on state Medicaid funding;
  • Addressing IDD waitlists and funding;
  • The ongoing funding of SNAP benefits and how the state is addressing fraud, waste, and abuse;
  • Efforts to stabilize the human services workforce infrastructure with hiring and retention funding;
  • Maternal Health Care funding;
  • The viability of funding for the PA Medicaid 1115 Waiver;
  • Childcare and early education funding, including $10M in early intervention workforce monies;
  • Concerns about the fiscal and operational risks of covering GLP-1 medications; and
  • The absence of a unified plan for the allocation and implementation of the $100M in school-based mental health funding.

View the 2025/26 Department of Human Service Blue Book for in-depth budget information. Members can watch the full hearings and read the transcripts below:

Contact your RCPA Policy Director with any questions.

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Photo by Joakim Honkasalo on Unsplash

The House Appropriations Committee held the 2025 Department of Human Services (DHS) Budget Hearing at the Capitol in Harrisburg on Tuesday, March 4, 2025. DHS was represented by Secretary Dr. Valerie Arkoosh and Gloria Gilligan, Director of Fiscal Management, Office of the Budget. Other DHS leadership was also present.

The House Appropriations Committee was equipped with questions surrounding the proposed $21B DHS budget that focused on intersects with operating critical services for vulnerable Pennsylvanians across the human services landscape. RCPA submitted questions to the House Appropriations Committee’s legislators that voiced the concerns of the membership across all policy areas.

The hearing today covered several of those questions, including:

  • The projected $2.5B dollar increase in the capitation and intersects with Medicaid unwinding in PA;
  • Impacts of potential federal Medicaid cuts on state Medicaid funding;
  • Addressing IDD waitlists and funding;
  • The ongoing funding of SNAP benefits and how the state is addressing fraud, waste, and abuse;
  • Efforts to stabilize the human services workforce infrastructure with hiring and retention funding;
  • Childcare and early education funding, including $10M in early intervention workforce monies;
  • Concerns about the fiscal and operational risks of covering GLP-1 medications; and
  • The sustainability of State human services with the increases over the last several years.

RCPA will continue to monitor the hearings and subsequent reporting, and we plan to provide an overview of the Senate Appropriations Committee DHS Budget Hearing held today, March 5. If you have any questions, please contact your respective RCPA Policy Director.

Members can watch the full hearings and read the transcripts below:

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For members’ convenience, please find below the links to the House and Senate Department of Human Services (DHS) budget hearings. The House hearing is tomorrow, March 4, and will be starting at 10:00 am; the Senate hearing is on Wednesday, March 5, and will be starting at 9:30 am. Both hearings will be held the entire day, with a break scheduled for lunch.

If you have any questions, please contact Jack Phillips.

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The Office of Long-Term Living (OLTL) released the rate study that was commissioned last August after RCPA and other industry associations collaborated to access the information needed to establish rates for services.

For background purposes, HCBS are offered through Medicaid as an alternative to facility or institutional care. Reimbursement rates for these programs are set by DHS and are informed by an actuarial rate setting process and a public comment process. Long-term services and supports (LTSS) help older Pennsylvanians and adults with physical disabilities.

The rate study revealed the need for substantial and immediate rate increases for the services which were evaluated. The study concluded, “Given the comparisons to benchmark rates, it appears that revisions to the rates studied for this report would be appropriate. The tables below show detailed results from the benchmark rate comparison.” The specific rate gaps were:

  • Adult Day                                                                     19%
  • Employment and Training Services                             35%
  • Personal Assistance — Agency                                   23%
  • Personal Assistance — PDS                                       12%
  • Residential Habilitation                                                44%
  • Structured Day Habilitation                                          22%

Findings of the study are used to inform the Commonwealth’s budget and future rate setting processes. View the results here.

If you have any questions, please contact Fady Sahhar or Melissa Dehoff.

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The Department of Human Services Office of Children, Youth and Families (OCYF) is supporting a specialized training effort addressing child abuse recognition as well as reporting training for residential facilities through a contract with the Pennsylvania Family Support Alliance (PFSA). This training is for child residential staff, their related purchasing entities, and local law enforcement agencies.

Register for an upcoming training:

Training Summary:

This training is for providers and other child serving entities. It will cover clarification on what allegations must be reported to ChildLine as suspected child abuse and/or HCSIS as a reportable incident, and further clarifies when an alternative plan of supervision must be put into place. This training also teaches minimal facts interviewing skills to better determine when to make a report and explains how those reports of suspected child abuse are categorized and handled at ChildLine. Lastly, internal follow-up recommendations and communication are discussed. Other entities that interact with these 3800 facilities are also welcome to attend, including OCYF Regional Office Reps, law enforcement, and MCOs.

This training mirrors the information outlined in the OCYF Bulletin # 3800-21-01 issued January 19, 2021, and is meant as additional training (not a replacement for the mandated reporter training).

Please contact RCPA COO and Mental Health Policy Director Jim Sharp or RCPA Policy Associate Emma Sharp with further questions.

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By Jason Snyder, Director, SUD Treatment Services, BH Division

As I watched Pennsylvania Governor Josh Shapiro give his budget address last Tuesday, it occurred to me that the light Pennsylvania government had brightly shined on the addiction epidemic for nearly the past 10 years has greatly dimmed.

In a speech of nearly 11,000 words, not one of them was “addiction.” Not one mention of treatment. No mention at all of an overdose death epidemic. Over the course of a 90-minute budget address, Gov. Shapiro, a man who likes to “get stuff done,” did not even attempt to take credit for overdose death numbers that are trending downward. He didn’t acknowledge them at all.

Granted, the Pennsylvania Department of Drug and Alcohol Programs (DDAP) continues to release pots of opioid settlement and federal money, including State Opioid Response (SOR) funding, into the behavioral health ecosystem, though not all of it is available to DDAP-licensed treatment providers. Counties also continue to spend opioid settlement dollars from multiple sources, including a national settlement with the three largest pharmaceutical distributors that netted more than $1 billion for Pennsylvania.

In arguing that everyone else is legalizing adult-use recreational marijuana, so Pennsylvania should, too, the governor ignores the evidence of the harms of marijuana, including a link between legalized adult recreational marijuana and an increase in adolescent suicides, as well as the broader implications for addiction treatment such that not one dime of the $536,000,000 in estimated Fiscal Year 2025/26 revenue is proposed to be directly allocated to DDAP. Although it appears recreational legalization is inevitable at some point, failing to acknowledge its potential to harm some Pennsylvanians is disingenuous.

Dig a little deeper into the budget, and it looks no brighter for addiction treatment providers.

Behavioral HealthChoices — the name for Pennsylvania’s Medicaid managed care program for behavioral health — currently is in a financial crisis. Pennsylvania counties and behavioral health managed care organizations (BH-MCO) are reporting to be significantly underfunded due to a Department of Human Services’ (DHS) actuarial error made in calculating the effects of the unwind of the Medicaid rolls post-Covid. The underfunding is affecting the counties’ abilities to meet contractual obligations to provide behavioral health services. In other words, the $6.3 billion comprised of state and federal dollars in the current fiscal year (2024/25) budget (see p. 104 of 372 of DHS’s budget book) for Behavioral HealthChoices capitation — capitation being a form of payment based on a complex formula that determines an amount of money needed per Medicaid recipient per month — is not enough money to pay for addiction and mental health treatment for everyone who wants and needs it.

Although we see an 18 percent increase in the HealthChoices capitation line item that amounts to $660 million in state dollars in the governor’s proposed executive budget, significant questions are still unanswered and even bigger concerns remain.

For example, we do not know how much of the 18 percent increase is earmarked for Behavioral HealthChoices, which is concerning because the Physical HealthChoices program also is underfunded, and the Physical HealthChoices program is a significantly higher expenditure. Estimates suggest that the Behavioral and Physical HealthChoices systems combined need an additional $2.5 billion (state and federal combined) in the current calendar year, which is partly funded by two separate fiscal year budgets, to meet their obligations to Pennsylvania’s most vulnerable. There is a $230,000,000 supplemental payment in the proposed budget, which would help to address the immediate need for additional funds in the current fiscal year, but we are hearing only a small percentage of this is for the HealthChoices issue.

As a result of the underfunding and uncertainty, BH-MCOs and primary contractors have announced to addiction and mental health treatment providers that they will not receive any increases in reimbursement rates in 2025, despite escalating provider costs. At the same time, in certain regions of the Commonwealth, addiction and mental health treatment providers are beginning to report increasing challenges in getting appropriate treatment authorized (e.g., decreased lengths of stay, increased denials). Although anecdotal, RCPA will continue to have these discussions and look to substantiating data.

The current HealthChoices crisis has been building since early 2024 and has caused much anxiety. So far, the proposed 2025/26 budget only exacerbates the worry. Add in the federal Medicaid and grant funding uncertainty coming out of Washington, DC following recent executive orders that potentially put funding streams like the Substance Use Prevention, Treatment, and Recovery Services Block Grant and SOR dollars at risk, and the calamity grows exponentially. Right now, we are looking at a real possibility of ongoing behavioral health service cuts that would be akin to rationing of care.

At this point, I am left with a few fundamental questions. How is $6.3 billion not enough to provide behavioral health services — addiction and mental health treatment — to Pennsylvania’s Medicaid population? How could the state have been so wrong on its calculations? How sustainable is a behavioral health system that needs at least upwards of $7 billion per year? Does the legislature have an appetite for such a system?

And, perhaps most importantly, what are the implications for the future of addiction treatment and the sustainability of the system as we currently know it? Beyond the funding crisis, the field continues to beg for relief from administrative burden and crushing oversight, pleas that have amounted to shouting into the void.

With DHS’s budget hearings coming up in early March in front of the Senate and House Appropriations Committees, I would expect the legislature to also be asking these same questions. Stay tuned.

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